The power of decision lies in our hands from Step 1 to 3. We can look at various factors, research, and take a decision after careful thinking and evaluation. But once we purchase a company’s stock, power shifts from us to the company’s performance and the decision taken by its management.
But, what we can still manage to do is, keep an eye on every move of the company religiously so that we remain on the winning side, always. Financial health of the company is checked by continuous analysis of different factors like the net profitability, the investment, etc. Apart from technical analysis, we also monitor the performance of the CEO of the company whose stocks we have purchased.
In addition, to further evaluate the success and performance of a company, we also keep a check on the industry trends and its competitors’ performance and market potential.
If the company’s evaluation and CEO performance analysis suggest any absolute or relative negative indications, then we sell the stock of the company to prevent losses and our capital. Else, if the CEO and company is performing well, we will keep the stock.